Bookkeeping is an important aspect of any organisation, small or large. Bookkeeping involves the recording of financial transactions (such as sales and purchases), and is a component of the process of financial accounting in most organisations and company. It entails preparing individual source documents for each transaction, transactions, and other significant events of an organisation. The significance of bookkeeping in the financial accounting process can not be overstated; a good quality bookkeeping process will help keep one’s books in order and can provide an invaluable reference for investors and lenders.
While all business owners need some form of bookkeeping, those who do not have a dedicated staff or internal accounting system will find that it is useful to hire professionals to help with this task. There are many professional bookkeepers available who are experienced at keeping track of various financial transactions and reports. One of the benefits of utilizing an external bookkeeper/accountant is that they are often paid on a per hour or per project basis, taking into account their skills and the current trends in the market. Many external bookkeepers and accountants offer their services on a contractual basis, which means that you only pay for what you require, not on a set rate. The standard practice is to allow an accountant to manage the accounts on your behalf; this is usually a better option for small business, though if you have a large and complex business, it may be worth considering an accountant with a management experience.
Bookkeeping can be broken down into three major sections: Financial Report Writing, Management And Supervision, And Invoicing And Accounts Receivable.
Financial reports are prepared by an accountant, with input from the company’s senior management, whilst supervisory and management duties are performed by an accountant.
All transactions are recorded in writing, either with the customer’s payments or manually, though more modern accounting software allows for both types of transactions to be recorded simultaneously. The records will then be processed by the finance department, who will generate the financial reports, these being sent to the CEO and Finance Directors. The invoices that will be generated will be due to be sent to the clients for them to pay, these being a mix of fixed and variable charges.